Taking stock of your life insurance
By Alina Parizianu , CFP ® , MBA , RICP ®
Most people don ’ t like to think about life insurance coverage .
However , in the event of your death , having it can mean your family will be taken care of financially .
Proper life insurance coverage can eliminate concerns about money and finances as loved ones grieve your death . Even modest funerals involve a considerable outlay of money . When there is no life insurance policy to cover these expenses , it might force loved ones into alternative means of paying for their final expenses such as asking family members for assistance , financing the cost through the funeral director , or even starting a “ Go Fund Me ” page .
Life insurance can be confusing , but that is not a reason to skip this important coverage . Some key considerations :
What exactly is life insurance , and how does it work ? Simply put , life insurance is a contract between you and the insurance company . You make regular premium payments to the insurance company and , when you die , it pays a benefit to your loved ones which can help replace income or pay off debt .
With many different types of policies available , how do you know which one is right for you ? You might be covered by life insurance provided through your employer , known as group life insurance . This is life insurance that you purchase as part of a group — typically through your employer — as part of your benefits package , or through a member organization . These insurance plans offer relatively affordable premiums because employers and large organizations can purchase in bulk . Some employers provide term coverage equal to 100 percent of a worker ’ s salary at no additional cost to the employee . Although group life might not provide the comprehensive coverage you want , it can be an easy , cost-effective way to start or supplement your life insurance protection . Keep in mind that in most cases , you will lose your life insurance plan if you leave your current employer . Some group life insurance is portable , meaning that if you leave your job , you can take your coverage with you . Be sure to ask about this .
12 CHURCH EXECUTIVE | JULY / AUGUST 2021